On Tuesday, the USDA unveiled its most recent supply and demand projections. US soybean production witnessed a reduction and this, coupled with decreased usage, resulted in historically low ending stocks of 220 million bushels. Despite a tighter soybean balance sheet, prices followed the downward trend of corn. Local bids currently range from $15.50 to $16.00 per bushel, depending on the farm location. Dry bean bids are expected to receive late-season support from Mexican demand and lower production. However, they are currently overburdened by carryover supplies from the previous crop year. Canadian faba bean volumes are projected to decrease compared to the previous year. Feed-quality faba beans continue to find support from pet food values, with local bids for export-quality #2 faba beans ranging from $13.50 to $14.00 per bushel FOB, depending on farm location. Feed-quality faba beans are fetching values near $10.00 to $10.50 per bushel FOB farm, also dependent on location.
The current barley market still shows a slight retracement, reflecting the recent trends we’ve observed over the past few weeks. Nonetheless, buyers continue to actively seek opportunities to secure feed barley for multiple delivery periods. Indicated prices across the prairies range from $5.50 to $6.00 per bushel FOB farm, depending on area and timeframe of the delivery. While buyers are still open to purchasing barley, they are not aggressively pursuing it as corn continues to make its way into feedlots with some buyers anticipating coverage until July 2024. On top of this, late-season rains during harvest may have impacted the quality of barley intended for malting, diverting it towards the feed market. Although finding a malt bid may be challenging at present, maltsters are in fact looking, so get your samples in for review! If you already have malt specs and a desired selling price, it is highly advisable to call and explore potential opportunities/throw out a firm target.
The lentil market has remained relatively stable this week, with minimal fluctuations in pricing across various types and sizes of lentils. Red lentils began the week slightly lower compared to the end of the previous week, but late Tuesday afternoon, we observe a resurgence with product trading at $0.39-$0.40/lb FOB farm once again. However, it’s worth noting that the market for red lentils seems somewhat shallow at the moment, so if you’re considering selling, it may be prudent to start marketing sooner than later. Large green lentils, as well as small greens, have seen little change compared to previous weeks, still showing active interest from buyers. Large greens are trading within the range of $0.62 – $0.63/lb FOB farm, while small greens are at approximately $0.60/lb FOB farm. Similar to red lentils, we anticipate that these prices may experience a slight pullback once more tonnage is secured. Speculation throughout the prairies suggests that, despite facing drought conditions in many areas, overall crop performance appears to be better than initially anticipated.
Flax prices are exhibiting strength this week, fluctuating between $17 and $17.50 per bushel FOB, contingent upon shipping window. Analysts are cautiously optimistic but anticipate exports to be slightly more fluid compared to the previous year. Notably, both China and the United States registered higher export volumes in July year over year, but demand within the European market appears to be somewhat constrained. Near term Chinese importing may remain subdued due to inventories residing in warehouses. Global flax supply is poised to shrink in the 2023/24 period, primarily attributed to reduced flax production in North America, Russia, and Kazakhstan. This contraction in supply is likely contributing to recent price increases. The looming question remains to be whether China will replicate its strong demand for flax again this marketing year.
As of early last week, the Sask Crop Report showed 45% of the canaryseed crop had been harvested. It is worth noting that this percentage has likely increased as more reports from growers who have completed harvest roll in. Pricing for canary remains stable compared to the previous week, with bids ranging from $0.45 to $0.46 per pound FOB farm, depending on the farm’s location and the intended shipping period. Reported yields have shown significant variation across the province, ranging from single-digits in the southwest to more impressive 30-bushel-per-acre crops in the northeast. Notably, firm offers for canaryseed continue to generate interest among purchasers. If you are considering selling your canary, contact your merchant to explore pricing and movement options.
Oat demand has maintained a relatively subdued presence in the market recently. Feed grains have seen a decline in prices, while short-term milling requirements are gradually being met. On the feed side, the influx of more cost-effective corn and barley has led to constrained oat allocations in rations and subsequently, softer pricing/demand. Feed values are currently in the range of $4.00 to $4.50 per bushel, contingent on location and shipping timeframe. Meanwhile, on the milling side, strong bids from the previous week appear to have addressed immediate demand needs, prompting a more cautious stance from buyers. Sask milling bids are currently quoted at $6.00 per bushel for delivery between April and August. In contrast, Manitoba’s milling requirements offer quicker movement options, with bids in the vicinity of $5.25 per bushel for September/October. Notably, there are price premiums in Manitoba markets for those willing to defer shipping.
At time of writing, canola futures have declined by nearly $50 per MT since last Tuesday, now resting at $752/MT. Harvest pressure is now on as canola begins to hit the bin and producers seek quick cashflow. In yesterday’s USDA estimates, Canadian canola production was revised down to 18.7 million tonnes, marking a decrease from the previous report of 19 million tonnes. Statistics Canada is set to provide an update on their numbers tomorrow, based on farmer surveys conducted as of August 31st. There appears to be a glimmer of hope as soybeans and soyoil gain momentum with expectations that, “a rising tide raises all ships.” Hopefully, this will allow us to regain some of the lost ground. In global news, an issue deserving of attention is Mexico’s ban on GMO corn. This development raises concerns about the fate of Canadian GMO canola, especially considering that Mexico is Canada’s third-largest export market for canola.
The pea market remains firm and has even shown continued strength this week, deviating from the usual trend of lower bids and softer demand due to harvest pressure. The standout performer in the pea world are undoubtedly maples, where trade values have soared, reaching as high as $25 per bushel FOB for fall deliveries of #2 quality. If you’re a maple grower who hasn’t capitalized on this market yet, we strongly recommend giving it serious consideration. Maple markets can be unpredictable at times, so when the opportunity arises to sell at such lucrative prices, it’s a “slam dunk” decision to make. Furthermore, there’s positive momentum in other pea markets as well as #2 quality green peas are garnering attention with targets triggering above $16 per bushel for fall pickup at the farm. Yellow peas are also making small waves, with trades ranging from $10.25 to $10.50 per bushel FOB farm, depending on the location, for near-term deliveries. Targets slightly above these levels may be entertained from the buy side as well. While it’s uncommon to see such strong pricing in the fall, it’s not unprecedented. In the past, there have been instances where the best prices of the marketing year were offered during the initial harvest period when demand was high. However, once the initial rush subsided, market activity quieted down. This isn’t to say that this will be the exact pattern for this marketing year, but it’s worth considering if you’re contemplating taking some risk off the table with partial sales today.
Chickpea market reports suggest a potential decrease in carryover from last year accompanied by slightly higher yields from this year’s production. This leaves the chickpea marketing situation essentially unchanged, mirroring the status quo of the past few weeks. Currently, old crop #2 large kabulis are fetching bids at $0.55 per pound, FOB farm, for movement between September and November. Smaller sizes are seeing a slight decrease, with an average $0.02 per pound spread lower. In terms of USD, this translates to approximately $0.40 per pound, FOB farm, for the same movement. US growers appear to have faced fewer adverse growing conditions and are not reporting significant quality issues related to size. However, it’s worth noting that size remains a potential concern for North American growers on a whole. As we await further yield and quality results of the ongoing chickpea harvest, it’s essential to have your samples evaluated before diving into marketing strategies. This advice has held true in the past and will continue to serve as the best approach for chickpea producers.
Mustard prices have maintained relative stability throughout the week as the harvest progresses. Reports on crop yields are still trickling in, reflecting the varied impact of sporadic rainfall on different areas. Yellow mustard prices continue to be quoted in the mid to high 80-cent range, but targets around 90 cents per pound may grab some attention. Oriental mustard hovers around the mid-70 cent per pound mark, while brown mustard prices fluctuate between the high 70’s and low 80’s per pound. It’s essential to emphasize the volatility of these prices, making it advisable to get in touch with your Rayglen merchant for the most accurate and up-to-date information. This will enable you to seize the best available pricing opportunities. While it may seem early, we welcome any insight or firm targets you have on production for the 2024/25 crop year.
This week’s significant development in the wheat market revolves around the USDA’s latest supply estimate, which reported figures lower than initially anticipated. The USDA predicts that global wheat production will decline to approximately 787 million tonnes, representing a decrease of roughly 6 million tonnes compared to last month’s estimate. If these projections hold true, it will mark the lowest global wheat production since the 2018-19 season. Several major wheat-producing nations, including Australia, Canada, and Argentina, have revised their wheat production estimates downwards which has played a significant role in these updated numbers. In contrast, Russia’s and the United States’ estimates have remained largely unchanged, while Ukraine has raised its estimates. The global market has responded with modest gains over the past two days. On the local front, the feed wheat markets are still grappling with the pressures of the harvest season, corn imports and lower overall feed values resulting in prices ranging from $8.00 to $8.50/bu FOB farm, depending on freight costs. For #2 hard red wheat, bids are in the range of $8.50 to $9.00 FOB. Notably, this week, buyers seem to be showing particular interest in soft white wheat, with bids resembling HRSW values.
Rayglen Market Comments are for informational purposes only. Rayglen Commodities and its agents or employees shall not be liable for any loss or damage suffered by any person as a result of reliance on any of the contents contained within these products, whether such loss or damage arises from negligence or misrepresentation or any act or omission of its agents or employees.